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O-licence renewals: timeliness is crucial

  • 22 March 2012
  • By Justin Stanton

In a busy world it is all too easy to forget things, but something operators should never overlook is paying the renewal fee for their O-licence, writes Laura Hadzik is a solicitor at JMW Solicitors. Forget this and your fleet automatically becomes an illegally run operation.

Decisions made by traffic commissioners and transport tribunals continue to confirm that non-payment or late payment of renewal fees will result in the automatic termination of your O-licence unless there are truly exceptional circumstances. The law is clear – if payment of the renewal fee is not received by the prescribed date, the O-licence   will automatically terminate at that time.

A matter of courtesy
Operators will normally receive a letter from the Office of the Traffic Commissioner (OTC) in Leeds, reminding them that their renewal fees are due to be paid by a certain date. However, decisions by TCs and tribunals consistently make it clear that there is no provision in the legislation for such reminders – they are sent simply as a matter of courtesy.

The obligation to ensure the fees are paid by the prescribed date is placed fairly and squarely on the  operator. Operators arguing that their late or non-payment of the renewal fee is because they did not receive a reminder letter from the OTC can expect no sympathy.

After the licence is terminated, you cannot operate vehicles until you have applied for, and obtained, at least an interim grant of a new O-licence. Because the licence has terminated automatically, rather than been revoked, there is no reason to suppose a new one will not be granted, but a period off the road could put some operators out of business. At the very least it will inconvenience your customers and raise a wage bill when no work has been done.

TCs and tribunals can exercise their discretion to disregard the automatic termination of an O-licence if exceptional circumstances exist. In deciding what is exceptional, their approach has been to apply the main dictionary definition of the word exceptional, ie. unusual – the question to be asked is whether the circumstances put forward by the operator to explain late or non-payment merit that description.

Once the TC or tribunal is satisfied that exceptional circumstances do exist, they must consider whether this has caused or contributed to the late or non-payment of the renewal fee.

The final decision for the TC or tribunal is whether or not to exercise their discretion to disregard the automatic termination of the O-licence.

Factors that will be taken into account include the operator’s past payment history; and the extent to which the operator has failed to comply with the primary responsibility to pay the renewal fee on time.

Factors that will not be taken into account include the fact that the operation of vehicles on a daily basis is essential to the operator’s business. As the examples in the panel show, it is not easy to persuade the TC that the licence should not be terminated and a fresh application made.

It is essential that you make a note of your O-licence expiry date and ensure the OTC is informed of any changes to your correspondence address. The reality is that, while there is no requirement for the OTC to send reminder letters, in many cases payment is, in practice, triggered by receipt of the reminder letter.

Arguments that didn’t wash
The following explanations put forward by operators did not constitute exceptional circumstances. In each case, the licence was terminated and the operator was obliged to make a fresh application.

On holiday
The operator was on holiday when the OTC forwarded the reminder letter. The operator responded immediately on return (after the prescribed date) stating that it wished to continue operating, that non-payment of the renewal fee was due to a genuine oversight and it had operated vehicles for 30 years without any previous issues. The TC and the tribunal found there were no exceptional circumstances, pointing out that, even in the absence of a reminder letter from the OTC, which was simply a matter of courtesy, the licence discs displayed the expiry date and it was the responsibility of the operator to ensure payment of the renewal fee was made by the prescribed time. It would therefore be sensible for operators to make a note of this date.

Working abroad
The operator was working abroad when the OTC forwarded the reminder letter. He responded immediately on his return, after the date of expiry, stating that his failure to receive the letter because he was abroad had caused the non-payment. The TC and the tribunal found there were no exceptional circumstances. The obligation to pay the renewal fee rests with the operator. He would have seen the expiry date on the discs  during the daily walk-round checks and known he would be abroad when the fee fell due. It was up to the operator to make arrangements for payment while abroad.

Change of address
The operator failed to notify the OTC of a change of correspondence address as a result of mismanagement and an oversight. The operator did not therefore receive the reminder letter from the OTC and did not pay the renewal fee. The TC and the tribunal found that there were no exceptional circumstances in this case, pointing out that the onus is on the operator to ensure that the TC is informed of the up-to-date position in relation to the correspondence address.

  • Laura Hadzik is a solicitor at JMW Solicitors specialising solely in road transport law. 
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